Of course if you are going into it with a long time horizon that is great and you might think it may not matter, but you have to factor it in. 

Given these factors, should I consider renting to this person? 

Yes, you should be able to do this, so long as the DTI for the Conventional loan works once the new minimum pmt on the Heloc is factored into your debts.

Of course, you can't protect yourself completely, but this will also help you prepare for buying the next properties a little better, and it's an exercise I generally do when I'm on a showing for a property I'm serious about so that I'm factoring this into my analysis to some degree in a "capex" reserve.Capital ExpenseRoofWater Heater x2All AppliancesDriveway/Parking LotBoiler x2FlooringPlumbingWindowsPaintCabinets/CountersStructure (foundation, framing)Components (garage door, etc.)

This factor significantly impacts your long-term success and stress levels as a landlord.Be wary of theoretical numbers, especially for C-class properties.

I can borrow $100k of it to add as additional down $ and I'm pretty sure a 401k loan won't show against my DTI, but then it will show as less assets (unless a 401k doesn't get really factored into everything since it's usually unaccessible). 

When factoring in many alt. lenders do not include a pre-payment penalty when you refinance the total finance charges including pre-payment penalties differs slightly between bank and alt. lender.  

Once you get a good number in mind, plus costs for repairs, plus a rough perspective of appreciation in the area (because BRRRR doesn't really work until you factor that in here), you can technically make an offer yourself.

And that doesn't include other expenses.So the traditional SFH route may work eventually including appreciation and other factors, but probably not in 10 years because you need to refi and purchase other houses to make this angle work.Buying a 2/1 somewhere and living on one side is another option, as is renting both sides, but you'd have to identify an area where you can afford a duplex.

You still need to look at the other risk factors, determine what level of risk is present, whether you will accept that risk, and how you will mitigate it.